His group holds around 80 percent of Uniper.
(Photo: via REUTERS)
Stockholm There have been better days for Markus Rauramo. On Thursday, the boss of the Finnish energy giant Fortum had to present the shareholders with a very weak half-year result. The group reports a minus of 9.1 billion euros for the first six months of this year.
The main reason for one of the highest losses in the company’s history is the situation at the ailing Fortum subsidiary Uniper. The German gas supplier has gotten into an acute financial crisis as a result of the cut in gas deliveries from Russia, because it had to procure replacement deliveries at a significantly higher price but had to deliver them to contract customers at the old price.
The federal government and Fortum jumped in with a cash injection to prevent the gas supplier from going bankrupt. Fortum holds around 80 percent of Uniper. However, this share will drop to below 60 percent after the federal government gets involved.
Rauramo does not currently see the situation improving any time soon. He blamed Russia alone for the difficult situation. The country has launched a “brutal war in Ukraine and an energy war against the EU”. In the coming quarter, according to the Fortum boss, the losses can therefore be even greater.
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After the Russian attack on Ukraine, Fortum decided to withdraw from the Russian business. Therefore, write-downs of around 2.3 billion euros are necessary.
Close connection to Uniper
Despite the very tense situation, the 54-year-old Rauramo was combative. “We want to bring Uniper back into the black,” he said at the company’s headquarters in Espoo near Helsinki. He did not want to comment on speculation that Fortum wanted to sell Uniper as quickly as possible.
On the other hand, he was more willing to provide information about the results of the parent company. Fortum itself made a profit of 574 million euros. The electricity production is profitable but cannot offset the losses at Uniper, he said.
Rauramo has a close connection to Uniper, as he was the CFO of Fortum who engineered the takeover. He is also a member of Uniper’s supervisory board.
Rauramo has held various positions at Fortum for ten years. Before he succeeded Pekka Lundmark, who had migrated to Nokia, as the new Fortum boss in mid-2020, he was CFO at the Finnish group.
Before joining Fortum, the business economist, who also has a master’s degree in political science, worked for Finland’s Stora Enso, one of the largest paper and forestry companies in the world. There he represented, among other things, the interests of the company in Brussels. Back home, he became CFO at Stora Enso before moving to Fortum in 2012.
Also engaged in air conditioning
At the group, he is the boss of around 20,000 employees in 40 countries. The Finnish state is the largest shareholder with almost 51 percent. In consultation with the main shareholder, Rauramo has set itself the goal of making the energy giant completely climate-neutral in Europe by 2035. This goal is to be achieved worldwide by 2050. However, he considers gas to be justifiable as an interim solution.
Fortum is active in almost all areas of energy production and supply. In addition to energy production through nuclear, hydroelectric and thermal power, the group is also involved in air conditioning. Waste incineration, solar energy and biomass make up other business areas. In the Nordic countries, as well as in Poland and Spain, Fortum also acts as an electricity and gas trader for private customers. Last year, the operating profit totaled 2.5 billion euros.
Rauramo is considered very assertive by his employees. This quality will probably help him to push through the reorientation of the group towards CO2-neutral energy production.
If you ask about Markus Rauramo in Finland, you usually get a shake of the head. The Fortum boss avoids the limelight and reveals little about his private life. It is only known that he is married and has two children. And, as some newspapers have found out, with an annual salary of almost two million euros, he is one of the top earners in Finland.
More: gas trader Uniper shares are approaching their low for the year – analysts see further downside risks
